State of NSW v Moss

State of NSW v Moss - [2000] NSWCA 133 - NSWCA 2000 case summary — Zoe

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3 It was necessary to work out what interest was payable on the verdict and to allow the appellant credit for payments already made. As to interest, it was held that the respondent was entitled to interest on $112,500 (half of general damages) for 10.15 years at the rate of 2%. This came to $22,837. It was further ordered that the respondent was entitled to interest totalling $89,100 with respect to the award for past voluntary assistance and to interest totalling $20,000 with respect to the award for past economic loss. When these sums were added to the jury's verdict and when the appellant was allowed credit in respect of payments already made by it, the resultant figure was $873,529. Judgment was entered in this sum. 4 At the time of the accident the respondent was an attractive young woman, aged 14. In response to a question whether she was a good student she replied "not bad. I wouldn't say bad". Her long-term ambition was to become a hairdresser. There was ample material before the jury capable of satisfying them that she would have achieved this goal had the cosmetic and physical injuries suffered in the accident not prevented it. She already had a part-time job. She had studied typing. Despite her horrific injuries, suffered in June 1988, her school certificate results at the end of that year were commendable. She had never returned to school after the accident, but had studied at home with the assistance of a tutor. Her post injury employment record and her capacity to get on with life after the accident demonstrated considerable drive and capacity. She was a competitive sportswoman, playing netball regularly and (for the two years prior to the trial in 1998) being involved in the administration of a netball competition. She was fortunate to have the support of caring parents and, latterly, of her husband. It would appear that she continued in paid employment right up to the birth of her two children in October 1995 and May 1998 and that she returned to paid employment fairly soon after each child's birth. 5 The accident in the science laboratory involved an experiment to extract fat from a sausage. The sausage was put into a beaker and heated over a tripod. Methylated spirits was poured into the beaker and there was an explosion. There was extensive burning to the whole of the respondent's face and most of her neck. The front and back of her hands were terribly burnt. There was also burning over much of the front of her body, including her right breast and over parts of her legs. 6 The respondent was in intensive care at Westmead hospital for two and half weeks and she spent a further three and half weeks in the burns unit at that hospital. She then returned to her parents' home. As indicated above, she never went back to school. There were many return visits to hospital for skin grafts, operations on her hands, operations on her ears (which on the outside had been reduced to small cauliflowers). There was extensive physiotherapy. For two and half years the respondent wore a pressure suit, known as a Jobst suit. This was painful and unsightly and the respondent needed help to get it on and off each day. The scarring was not just physical: the respondent required psychotherapy to cope with the anger, distress and sense of loss experienced in her teenage years. 7 Considerable scarring remains. According to a 1997 report from her plastic surgeon Mr Thompson, there remains very extensive visible burn scarring involving all areas of the respondent's face and the front of her neck and particular disfigurement of both external ears. The facial disfigurement is gross, visible and impossible to disguise adequately. No further surgical treatment is likely to ameliorate the overall impact of the facial scarring, which will be permanent and lifelong. There is also gross disfigurement of both hands which is impossible to disguise. The breast scarring caused difficulties in feeding the respondent's first daughter. The deformed ears remain very ugly. The respondent's hands are tight and cramped at times. The sensitivity of her skin means that she is restricted in exposing it to sunlight and needs special cosmetics. 8 In their final addresses to the jury, counsel for each party spoke to Schedules of Damages which they had prepared and which were given to the jury. The respondent's Schedule was as follows: 1. GENERAL DAMAGES (a) The plaintiff has suffered horrific injuries. She has gross scarring of the face, neck, breast and hands. She has large graft patches on her thighs and burn marks on her legs. She has distorted buds where her ears were. (b) She has undergone about 12 operations, mainly involving skin grafts with skin cut from her thighs. Her last admission to hospital was only 14 months ago. (c) In the course of her treatment she has been subjected to exquisitely painful procedures such as the daily baths to scrape off skin in her first admission and the scouring of her ears by her mother at home. (d) She wore an ugly, constricting and uncomfortable pressure suit for two years. (e) She has suffered and will suffer for the rest of her life (57 years) the mental anguish associated with her disfigurement and the loss of her self worth. (f) She has suffered acute depression and post traumatic stress disorder for years and continues to suffer those conditions to a lesser degree. (g) She is vulnerable to life stresses with which other people could cope, with the result that for her these stresses would probably result in depressive illness, with the further disruption of her life and the further need for psychiatric treatment. (h) She is restricted in where she can go (she must avoid sunlight) and what she can do (her hands, particularly, cannot stand exertion or trauma). (i) She is constantly reminded by the thoughtlessness of others of the serious compromise of her former beauty. This will never change. (j) She has the constant chore of having to protect her skin with creams and to apply special make-up which partially masks some of her scars. (k) She suffers from constant obsessive thoughts of what might have been if she had not been burned. 2. PAST WAGE LOSS It is difficult to be precise about the plaintiff's loss to date. She lost the best part of a year in 1989 and is entitled to be paid for the holiday pay which she took when she had to have operations. As well, there have been broken periods when the plaintiff has not worked, or not worked as much as she otherwise would have. Having regard to her relatively low earnings to date, it is submitted an appropriate allowance over the 10 years to date would be $20,000 3. FUTURE WAGE LOSS (a) The present average weekly net wage for full-time adult female workers in New South Wales is $500 per week. The plaintiff averages less than $300 per week, a difference of $200 per week. Over 40 years, to age 65, that throws up a loss of $244,840. Discounted by 10%, that is $220,356 (b) In addition, an amount ought to be allowed for the loss by the plaintiff of the opportunity to run her own business and to earn substantially above the average. No precise figures appear in the evidence, but it is submitted an appropriate sum would be $110,000 which represents a further $100 per week over 40 years discounted by 10%. Allow - $110,000 4. PAST MEDICAL AND HOSPITAL Agreed figure - $64,500 5. FUTURE MEDICAL AND HOSPITAL (a) Cosmetics, sun screen, moisturiser $12 per week for 57 years (multiplier $143.90). Allow - $17,255 (b) Hospital and medical excluding psychological costs (see Dr Thompson, report 25 September 1997, estimate of $14,000). Allow - $10,000 (c) Psychological treatment - • Dr Edwards - psychological consultation weekly for two years at $142 (multiplier $1-1.30): $14,389 • Then three-weekly for further eight years $16,595 (d) It is submitted that on the evidence of Drs Milton and Dyball as to the plaintiff's vulnerability to life events, an amount should be allowed as a buffer for the years from year 11 to year 57. Allow - $25,000 6. PAST VOLUNTARY ASSISTANCE (See separate schedule) 9 It can be seen that this document served at least four purposes: it showed the breakup of damages claimed by the respondent; secondly, it showed what items were agreed and what items were at issue; thirdly, it stated the maximum sums claimed for items of special damages; fourthly, it summarised the basis upon which the respondent advanced her claim under some of the heads of damage. 10 The two schedules went to the jury without objection on either side. They were referred to by counsel in addresses. It is not suggested that any assertion in the respondent's schedule was contrary to the evidence. 11 Judge Sinclair summed up to the jury on 13 August 1998. At the end of the summing up counsel for the appellant (the defendant in the court below) raised minor items of redirection that are not presently relevant. While developing his submission on one point, he contended that the trial judge had usurped the function of the jury and prejudiced the defendant's case. Asked whether he was asking for a discharge of the jury, counsel said that he did not have those instructions. Counsel then reverted to a rather confusing submission about future economic loss. It is hardly surprising that his Honour directed counsel to put in writing the redirection which he sought and to make it available to his opponent and to the judge by 9.15am the following morning. 12 No redirection was sought the following morning. Instead, counsel for the defendant applied for a discharge of the jury. The application was refused. The judge again invited counsel for the defendant to seek further directions, preferably in writing, if he had matters of complaint. No further direction was sought. 13 The appellant's failure to seek a redirection is not necessarily fatal, although it is a most material matter in determining whether there was a substantial wrong or miscarriage (Pt 51 r23, General Motors-Holden's Pty Ltd v Moularas (1964) 111 CLR 234, Calin v Greater Union Organisation Pty Ltd (1991) 173 CLR 33 at 39).

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Ground 4 (value of lost opportunity to be a hairdresser) 20 The appellant submits that the trial judge erred in leaving to the jury the respondent's claim for damages for loss of opportunity to conduct her own hairdressing business, there being no evidence of the earnings of self-employed hairdressers. 21 As stated above, the appellant faces the hurdle of establishing a substantial wrong or miscarriage in the context of a summing up about which no relevant redirection was sought. 22 The amended Statement of Particulars filed on behalf of the respondent well prior to the trial foreshadowed a claim that the injuries caused her to lose the opportunity of working as a hairdresser as well as the opportunity of owning and working in her own hairdressing salon. Her ambition to have done so is not in issue. And the appellant does not dispute that the cosmetic injuries and the injuries to the respondent's hands combined to prevent her from pursuing such employment. 23 The Schedule of Damages upon which counsel for the respondent addressed shows that the claim for "future wage loss" over 40 years set off the respondent's pattern of actual earnings to reach a two-part figure: - average weekly net wage for full-time adult female workers in New South Wales $500 per week = $220, 356 - additional allowance for the respondent's loss of the opportunity to run her own hairdressing business, claimed at the rate of an additional $100 per week = $110, 000. 24 The jury awarded these sums in full. The appellant complains about the additional $110,000. 25 It should be said at the outset that the jury were entitled to conclude that the respondent's prospects were "above-average". They saw her give evidence. They were entitled to view her prospects favourably, given the drive and resourcefulness which she had demonstrated before and after the accident, together with the evidence as to parental support which she was fortunate to have. The evidence is summarised above. The jury were clearly entitled to conclude that the respondent would probably have achieved her goal of becoming a hairdresser and eventually owning her own hairdressing salon, although it ought to have been understood that this would not have occurred overnight. 26 The appellant's submission as refined in argument accepts these matters. At the end of the day the nub of the complaint is the absence of evidence to support the proposition that a hairdressing business could or would have projected the respondent's earnings beyond those of the average weekly net wage for full-time adult female workers in New South Wales ($500 per week). Cf Hampton Court Ltd v Crooks (1957) 97 CLR 367. The real issue is whether it was open to the jury to conclude that the loss of that opportunity was productive of financial loss (Graham v Baker (1961) 106 CLR 340 at 347). 27 I had originally been troubled by this ground of appeal. However, the judgment of Heydon JA with which I respectfully agree has allayed my concerns. I agree with what his Honour has written and would reject this ground of appeal.

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Ground 5 (vicissitudes) 28 The appellant complains about the directions in relation to the conventional deduction for vicissitudes. It will be seen that this was an area where a specific objection was taken about the summing up. 29 In the respondent's Schedule of Damages (par 8 above) the respondent proposed a discount of 10 percent in the calculation of future economic loss. As will be seen below, the jury were invited to choose a factor between 10% and 15% and they chose 10%. The jury awarded the respondent everything that she claimed in regard to economic loss. 30 The relevant direction, the complaint made about it at trial, and the trial judge's response to that complaint were as follows: Then you have got this question of diminution of earning capacity, and in relation to that you have got paragraph 3, "future wage loss", and you see the basis of the submissions put to you by counsel for the plaintiff and what figures he takes. I suggest that you do not worry about trying to calculate these things, but accept the figures given to you. Because the law says that, for instance, when you are calculating a future wage loss, take a simple example of $10 a week for the next twenty years of a fellow's life. He might have chopped a bit of his finger off, but not much otherwise. You do not say that is $10 a year for this and this, and $10 a week for this, so that is $500 a year and ten years is $5,000 and so forth, because you would arrive at a sum which is far too much. What you have to take into account in your verdict is the present lump sum value of so much a week. There may be cases when you cannot do it on that basis, but whatever approach you take, frankly, you have to take some approach to start with to get an idea of what it is really worth, and the law says you go to the tables produced by actuaries and that is why you were given that figure, the multiplier, by counsel for the plaintiff. And so you have got the multiplier there. A dollar a week for the next 40 years is $1,224. If you were going to give her $100 a week then you put two noughts on the end of that. And then you might say "what is this discount by 10 per cent". That is another thing. The law says that when assessing the value of the diminution of earning capacity in the future, you must take into account the "vicissitudes" is a word I have always used, but it now seems to be exigencies of life. In other words, if you had a simple fellow who had a simple job and a set wage and then he lost his leg or something, and you are looking at assessing his loss of wages in the future you have got to take into account the facts of life. How many people go through life working five days a week for 40 years without having a bit of time off for something . Either they get an illness, or prang the car, or have an argument with the boss and they have to find a job somewhere else. That is some pretty rough examples of what vicissitudes of life is, and the court says then you come to your figure of diminution of earning capacity, you must then make a reasonable discount, again bearing in mind a particular plaintiff as to vicissitudes of life . After all, if the plaintiff in another case with a broken leg had not been in another job for a couple of months, and had an unfortunate habit of spending too long in the pub of a Friday night, and might even have got knocked down on the way home, that is the vicissitudes of life and that is why the discount is there. It has been suggested at 10 per cent by counsel for the plaintiff and I do not think any other figure has been suggested by counsel for the defendant, am I right? STERNBERG: I haven't your Honour, but your Honour would know that 10 per cent is not the normal vicissitude of life. HIS HONOUR: I'm not concerned with normal I am concerned with the plaintiff, and I asked you to give me submissions. STERNBERG: Well 15 per cent, if the jury gets that far, I would submit that it is 15 per cent. HIS HONOUR: Members of the jury, your range is 10 to 15 per cent . (emphasis added) 31 It was clear that the respondent was not going to earn $600 per week for an unbroken period of 40 years. For workers generally and for this plaintiff in particular there would be many contingencies or vicissitudes, positive and negative, properly to be taken into account. In this State 15% is a conventional starting point, as counsel reminded his Honour. 32 The appellant relies upon the following passage in the judgment of Beazley JA (with whom Powell JA and I agreed) in Nestle Australia v McDougall, Court of Appeal, unreported, 24 June 1998: It is accepted that the "usual deduction" for contingencies is 15%. This percentage was accepted by the High Court as "the practice" in New South Wales, "subject to adjustment up or down to take account of the plaintiff's particular circumstances": see Wynn at 498. See also Moran v McMahon (1985) 3 NSWLR 700 at 713-714; Burnicle v Cutelli [1982] 2 NSWLR 26 at 30; Commercial Union Assurance Company of Australia Ltd v Pelosi (unreported, New South Wales Court of Appeal, 2 February 1996). See also Government Insurance Office of NSW v Wojnar (unreported, New South Wales Court of Appeal, 15 December 1988) at 13 where Kirby P stated: "A conventional discount of 15% … is allowed in many cases, although this Court has been at pains to say that there is no warrant for inflexibility in fixing the appropriate deduction. The eventualities which people, individually, are likely to face in their lives necessarily vary enormously. They are particular to each injured claimant." A survey of the authorities reveals that discounts of up to 40% have been applied for vicissitudes. Urban Transit Authority of New South Wales v Seitis (unreported, New South Wales Court of Appeal, 17 May 1995) was one such case, where this Court increased the discount for vicissitudes from 25% to 40% where the plaintiff had cerebral palsy. It should be noted, however, that a 40% discount has been described as "high": New South Wales Insurance Ministerial Corporation v Sprengnagel (unreported, New South Wales Court of Appeal, 28 March 1995) per Priestley JA at 8.

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33 The principal negative contingencies or "vicissitudes" that are normally taken into account are sickness, accident, unemployment and industrial disputes (Wynn v NSW Insurance Ministerial Corporation (1995) 184 CLR 485 at 497). The latter two considerations were unlikely to impact markedly upon the trade of female hairdressing, assuming (as was the case presented) that the respondent was effectively locked into this perspective. This left sickness or accident and they were covered by the trial judge's directions. 34 Should the trial judge have told the jury that 15% was conventional in New South Wales? Failure to have done so was not, in my view, itself an error leading to a substantial miscarriage given the facts of this case and the appellant's failure, through counsel, to press the trial judge for a more specific direction concerning vicissitudes in which reasons for not departing from the conventional figure were outlined. 35 The nub of the appellant's complaint on this head is that the direction given by his Honour did not suggest any reasons why a lower than usual discount might be appropriate for this respondent. She was married with two young children, so the likelihood was that greater rather than less interruptions might be on the cards even for a modern working wife. Judicial statements about the relevance of individual circumstances are usually made in order to indicate that a greater than usual discount is called for, except for particular plaintiffs in occupations that enjoy high levels of security (see Luntz op cit pp285-6). To have left the jury with choosing between a 10-15% range was inadequate, notwithstanding the perfunctory submissions of the appellant's counsel at trial. The respondent's drive and capacity to work and to earn higher than average had been addressed (however adequately) in the jury's consideration of a starting point for the respondents pre-injury earning capacity ie the figures of $500 or $600 per week as the case was advanced by the respondent. This was the universe of discourse in which progression through apprenticeship to full employment to proprietorship was addressed. Additional remuneration through promotion was hardly apposite to self-employment in a hairdressing business.

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Ground 8 (use of written submissions in the form of the Schedule of Damages) 39 It is convenient to address ground 8 before ground 7. The Schedule of Damages is set out at par 8 above. 40 The blunt and largely undeveloped submission of the appellant that the trial judge ought not to have allowed counsel to provide written submissions to the jury deserves an equally blunt: "Why not?". The particular Schedule is a helpful summary that must have been of assistance to the jury. Its use as an aide memoire went without protest and was matched by the appellant's use of its own Schedule. 41 The Court was not referred to any case law on the broader issue. Even in the criminal law it may be appropriate for a summary to go to a jury, although the court retains a wide discretion, the practice is exceptional and demonstrated assistance to the jury (not just to a party) is critical (see Butera v DPP (Vic) (1987) 164 CLR 180 at 190, Tripodina and Morabito v R (1988) 35 A Crim R 183, Savvas (1989) 45 A Crim R 38). In Savvas Hunt J said (at 39): In civil trials, juries are often assisted by documents based upon the evidence which are put before them during the course of the closing addresses. I have in mind, in particular, calculations of damages in personal injury cases. It goes without saying that such documents usually set out the contentions of one party only and that there is often a number of elements in the equations worked out in those documents which are the subject of strong dispute in the evidence. That circumstance does not affect the validity of the practice in civil trials. Counsel could have dictated the detail in the document to the jurors, who would then have written down their own record of the addresses. The document is permitted to be given to the jurors for the sake of convenience and expedition. Jurors are correctly credited with sufficient commonsense to be able to appreciate the fact that some of the elements in the documents before them are in dispute. But, in no civil case would it be considered appropriate for such a document to go before the jury where it contains propositions of doubtful or spurious validity. The emphasis which a written document gives to such a proposition is not easily overcome by oral directions given by the trial judge in order to correct them. It would be quite unfair for such documents to go before a jury when they are considering their verdict.

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Ground 4: The course of the trial 55 The Amended Notice of Appeal sought an order for a new trial, or, in the alternative, a reassessment of damages by the Court of Appeal. Either step would involve an exercise of discretion by the Court. It would be relevant to the exercise of that discretion to know what was said and what was not said to the trial judge and to the jury, and why. Apart from the two Schedules, the trial judge's summary of argument in his summing up, a brief address by counsel for the defendant after the summing up, and the judge's remarks in rejecting an application to discharge the jury, there are no materials before this Court indicating what was said to the trial judge and to the jury. The plaintiff's Schedule conceded that there was no evidence of "precise figures" for the earnings of hairdressing businesses. The trial judge told the jury: "you do not really have the figures of what people earn in hairdressing salons". If there was an available "no evidence" point to be taken at the trial by the defendant with a view to preventing jury consideration of the issue, it was quite explicitly flagged by both the plaintiff and the trial judge. And if as a matter of substantive reasoning there was a significant weakness which the jury should have taken into account in the plaintiff's contention, both the plaintiff and the trial judge advised them of it, whatever the defendant did. 56 After the trial judge's summing up to the jury concluded, counsel for the defendant made various complaints about the summing up. One related to future economic loss, and was put as follows: "It is my submission that your Honour has not put fairly the defendant's argument in the way the defendant has run its case, that the jury has an option that it need not award the plaintiff damages for future economic loss because your Honour's summing up to the jury was really that they must give her something and it was the matter of how that was to be calculated. Whether it was to be calculated by way of a precise mathematical calculation or a diminution, and to that extent your Honour it is my submission that your Honour has to that extent usurped the function of the jury and prejudiced the defendant's case."

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Ground 4: The structure of the argument 62 The structure of the argument in relation to Ground 4 so far as the defendant is concerned is curious. Had the plaintiff below not run a case based on a loss of an opportunity to own a hairdressing business, but rather aimed at the same ultimate figure for damages in relation to injury to earning capacity by reference to future economic loss through a contention that with her drive and ability the plaintiff would have earned $600 per week as an employee, the criticism that there was an absence of evidence could not have been put with any plausibility at all. The fact that the plaintiff's case based on reduced capacity to earn was put as turning in part on the loss of an opportunity to run a hairdressing business was in a sense adventitious. What matters is how much the plaintiff's capacity to earn was reduced. Loss of a chance to earn income as proprietor of a hairdressing business is only one way of viewing that reduction in capacity. Another way of viewing it is as the loss of a chance to earn income as an employee from hairdressing or from some other occupation. In Bullock v Miller (1987) Aust Torts Reports 80-128 at 68,990-68,991 Underwood J inferred from the family background and intellectual capacity of the plaintiff, who was five when rendered incapable of work, that he would have stayed at school until 17 or 18 and then become apprenticed in a trade which would have provided him with his livelihood either as an employee or as the proprietor of his own business. Underwood J took the average of awards in various distinct trades. He increased the capital sum derived from that average because "the family background, intelligence and personality of the plaintiff is such that it is highly probable he very quickly would have been earning in excess of the minimum prescribed by the award". The jury were entitled to conclude that the present plaintiff could have earned more than the minimum wage, and indeed more than average weekly earnings. Her background, together with her intelligence, drive and personality, were established before the injury happened to her just before her fifteenth birthday, when she was much older than the plaintiff before Underwood J. Her circumstances were thus capable of supporting stronger conclusions than those reached by Underwood J. Yet the force of Underwood J's reasoning does not depend on any distinction between a career as an employee or a career as a proprietor. Nor does it depend on the selection of any particular trade. The point is that the position of the plaintiff before Underwood J could be analysed by reference to any of those trades. While the position of the present plaintiff can be analysed by reference to hairdressing, the value of the lost chance to exploit her impaired capacity to earn does not depend on that analysis alone. 63 The characterisation of the issue in Ground 4 as relating to a "claim for damages for loss of opportunity to conduct [a] hairdressing business" follows the language of paragraph 3(b) of the plaintiff's Schedule. This had the effect of drawing a false distinction between paragraph 3(b) and paragraph 3(a). In truth the assessment of damages for loss of earning capacity in relation to the future in every respect relates to the loss of an opportunity, or, as is now often said, the loss of a chance. The two parts of paragraph 3 wrongly suggest that one process of analysis is called for where the lost capacity is valued by reference to loss of wages, while another is called for where it is valued by reference to loss of profits. In each the process of analysis is the same: what is the monetary value of the lost chance to exploit the lost - or damaged or removed or amputated - capacity to earn income, by wages or otherwise, in future? The division of paragraph 3 into two parts was no doubt done merely to articulate one way of casting light on the value of the plaintiff's lost capacity to earn.

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Ground 4: Some authorities 66 There are two uncontroversial themes running through the cases relating to the assessment of damages for injury to earning capacity. One is that in general it is desirable for precise evidence to be called as to what the plaintiff would have been likely to earn but for the injury and what the plaintiff is likely to earn after it. The second is that the failure to call such evidence does not necessarily result in selection of only a nil or nominal figure as damages for impaired earning capacity. 67 Thus, in relation to the first of these themes, in Paff v Speed (1961) 105 CLR 549 at 559 Fullagar J said that the "usual method of proving damages under [this] head is by calling evidence to show what the plaintiff could probably have earned during the rest of his life if he had not been injured and what, if anything, he is now capable of earning". The same is true where the defendant is seeking to demonstrate that the diminution of earning capacity is only partial. Barwick CJ in Arthur Robinson (Grafton) Pty Ltd v Carter (1968) 122 CLR 649 at 657 said of a plaintiff who had been rendered almost a quadriplegic: "He has lost his earning capacity, so far as the evidence goes, all earning capacity. In this connexion, however, too little attention it seems to me is paid to the possibilities which have and will yet open up for paraplegics and quadriplegics: but this ought to be the subject of the evidence and not of mere suggestion on the part of judge or advocate." 68 The first theme was stated with the qualification "in general", because there is authority that in some circumstances over-elaborate evidence is unhelpful. In J K Kealley v Jones [1979] 1 NSWLR 723 at 734-5 Moffitt P said: "Sometimes, particularly in a jury trial, evidence of some claimed prospective earnings but for injury may distract rather than aid quantification of loss. A jury may well make a better assessment of the loss of a young law student debarred by injury from becoming a barrister by evidence such as in Gilles ' case [(1975) 49 ALJR 349] uncluttered by evidence of earnings made by selected leading senior counsel, with or without the aid of statistics as to success and failure rates of students and barristers, where such evidence is led in supposed aid of quantifying the lost opportunity of becoming leading counsel in the foggy future."

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In Malec v J C Hutton Pty Ltd (1990) 169 CLR 638 at 639 Brennan and Dawson JJ said: "the ascertainment of earning capacity involves an evaluation of possibilities, not establishing a fact as a matter of history." They approved Lord Diplock's statement in Mallett v McMonagle [1970] AC 166 at 176: "in assessing damages which depend upon its view as to what will happen in the future or would have happened in the future if something had not happened in the past, the court must make an estimate as to what are the chances that a particular thing would or could have happened and reflect those chances, whether or not they are more or less than even, in the amount of damages …". The majority (Deane, Gaudron and McHugh JJ) in Malec v J C Hutton Pty Ltd said at 643 that when the law takes account of future or hypothetical events in assessing damages, it can only do so in terms of the degree of probability of those events occurring in a range from just above the speculative to just below the certain. The inquiry - the process of estimation of possibilities - is thus an imprecise and indeterminate one to be carried out within very broad parameters. The trier of fact may have to form conclusions on "slender materials": Callaghan v Wm C Lynch Pty Ltd [1962] NSWR 871 at 877 per Evatt CJ, Herron and Sugerman JJ. That language, unlike the reference to permitting "guess work or speculation" elsewhere in that judgment, was not criticised in Ivkovic v Australian Iron & Steel Ltd [1963] SR (NSW) 598 at 607 per Manning J. However, Menzies J said that sometimes the assessment of damages involves "guess work rather than estimation": Jones v Schiffman (1971) 124 CLR 303 at 308; see also Linsell v Robson [1976] 1 NSWLR 249 at 259 per Mahoney JA; Chaplin v Hicks [1911] 2 KB 786 at 792 per Vaughan Williams LJ. Lord Diplock described the factors underlying the assessment of damages for diminished earning capacity as "matters of prophecy or judicial guesses" in Paul v Rendell (1981) 34 ALR 569 at 578. The English position was summarised thus by Lloyd LJ in Foster v Tyne and Wear County Council [1986] 1 All ER 567 at 570: "when it comes to estimating loss of earning capacity, there is no such thing as a conventional approach; there is no rule of thumb which can be applied. It would be so much easier if there were. But there is not. In each case the trial judge has to do his best to assess the plaintiff's handicap, as an existing disability, by reference to what may happen in the future. As has been said so often, that is necessarily a matter of speculation; it is necessarily a matter of weighing up risks and chances in all the circumstances of a particular case. The very fact that the approach must necessarily be so speculative means, of course, that the occasions on which this court will feel justified in interfering with a judge's assessment will be few and far between, for there is no established range or standard against which to measure the judge's award." 72 Thirdly, the mere fact that the quantum of damages is difficult to assess does not mean that the plaintiff is only entitled to a nominal sum. This principle applies as much to the assessment of damages for impaired earning capacity in injured plaintiffs as it does to pecuniary loss caused by negligent advice (Bowen v Blair [1933] VLR 398) or to loss in the form of the diminished value of damaged property (Wheeler v Riverside Coal Transport Co Pty Ltd [1964] Qd R 113), or equitable damages (Talbot v General Television Corporation Pty Ltd [1980] VR 224 at 250-1), or damages for breach of contract (Fink v Fink (1946) 74 CLR 127 at 143). In the last case, Dixon and McTiernan JJ put the following general proposition: "Where there has been an actual loss of some sort, the common law does not permit difficulties of estimating the loss in money to defeat the only remedy it provided for breach of contract, an award of damages." This was followed in Sellars v Adelaide Petroleum NL (1994) 185 CLR 332 at 349 per Mason CJ, Dawson, Toohey and Gaudron JJ. The same is true in tort. In Naylor v Yorkshire Electricity Board [1968] AC 529 at 548 Lord Devlin said: "in the law of damages … difficulty in calculation is not ordinarily taken as a ground either for reducing or for increasing the award". The court will be more ready to shoulder the burden of acting without specific evidence where that evidence is difficult to call. In Biggin & Co Ltd v Permanite Ltd [1951] 1 KB 422 at 438, a sale of goods case involving a recovery in respect of damaged goods, Devlin J said: "It is only that where precise evidence is obtainable the Court naturally expects to have it. Where it is not the Court must do the best it can". As McPherson J said in Nilon v Bezzina [1988] 2 Qd R 420 at 424: "The degree of precision with which damages are to be proved is proportionate to the proof reasonably available". The courts on occasion cite in related contexts Bowen LJ's related but stricter observation in Ratcliffe v Evans [1892] 2 QB 524 at 532-3, an injurious falsehood case: "In all actions … on the case where the damage actually done is the gist of the action, the character of the acts themselves which produce the damage, and the circumstances under which these acts are done, must regulate the degree of certainty and particularity with which the damage done ought to be stated and proved. As much certainty and particularity must be insisted on … in … proof of damage, as is reasonable, having regard to the circumstances and the nature of the acts themselves by which the damage is done." 73 The application of these principles is illustrated in a category of cases where the injury to a plaintiff who had the chance of a relatively high income if an appropriate tertiary training had been undertaken has prevented that training. In this category in particular the courts have not declined to make substantial awards to compensate for impaired economic capacity measured by valuing the lost chance to earn high income even though there was no evidence of the possible ranges of income. 74 In Ashford v Ashford (1970) 44 ALJR 195 at 196, a case where there was no evidence of particular income levels which would have been attained but for the injury and which could be attained after it, but where it was clear that there had been a diminution in earning capacity, Barwick CJ said for reasons including "the difficulty in determining what was the actual diminution of the appellant's earning capacity, the margins within which a trial judge might properly exercise his discretion in arriving at a verdict in this case were necessarily fairly wide." The High Court restored a verdict of the trial judge of $90,000 general damages, which evidently included $25,000 for impaired earning capacity. 75 In Graham v Fogarty (1970) 92 WN (NSW) 452 the plaintiff suffered serious brain damage at the age of 16. She was awarded $20,000 general damages. The report refers to no specific evidence of what her earnings would have been but for the injury and what they would have been after it. The Court of Appeal said at 453-4: "If by reason of her injuries the appellant does not marry, then the economic significance of her seriously diminished capacity to work in a gainful occupation, on which she would have to depend, will be considerable. If, by reason of an unsatisfactory marriage, she has to resort to employment to support herself, again it will be significant."

[39]

The point is that no specific evidence was called as to what the income levels of university graduates in science or economics were, and no complaint was made of this by any of the justices. The result was that the Court of Appeal's increase in the trial judge's award of $73,978.88 (which was made up of $45,000 for impaired earning capacity, $20,000 for general damages and $8,978.88 for special damages) to $100,000 was upheld, in part because of the error as to impaired capacity and in part because of the disproportion of the low figure for general damages. 79 There is a related category of case where a person with a particular skill is compensated for a loss of the opportunity to develop it in a way which would have brought improved financial outcomes notwithstanding the absence of evidence as to what persons successfully exploiting those skills earn. 80 In Hall v Wheeler [1962] QWN 40 the court valued a chance lost by a plaintiff whose pre-accident capacity to work in his occupation as butcher was unimpaired but who was a skilful ballroom dancer. The lost chance was the chance to win ballroom championships and thereafter establish a part-time career as a dancing teacher. There was apparently no evidence of the earnings of part-time ballroom dancing teachers. 81 In Leis v Gardner [1965] Qd R 181 at 188-9 the Full Court upheld a verdict which included £1,000 for the loss of a chance that the plaintiff, a bricklayer by occupation but with a background of success as an amateur cyclist, would have been able to develop a career as a professional. It did so despite the rejection of inadmissible evidence, and the absence of admissible evidence, showing what the rewards of professional cyclists were. 82 A similar case was Mulvaine v Joseph (1968) 112 Sol Jo 927, where an American professional golfer injured in Europe was awarded £1,000. It was awarded for loss of opportunity to compete in tournaments, and hence a loss of experience and prestige which might have resulted in him becoming a tournament professional in America, and also for the loss of a chance of winning prize money. Thompson J said that that "figure was bound to be speculative". There was apparently no evidence of what the earnings of a tournament professional might be, and what the prize monies might be. 83 Another category exists where the plaintiff, who has been carrying on a particular business, has been prevented from exploiting the opportunity of expanding it. In Szittner v Harriott [1967] 1 NSWR 233 at 237, an injury to one partner in a business caused one of the shops through which it was conducted to be sold and a planned expansion of the number of shops to be halted. The Court of Appeal, speaking through Jacobs JA, said: "[The jury] were considering loss of future earning capacity and it does not seem to us that it is appropriate to look for precise evidence of how much profits would be lost or whether the business would make profits, or not. It would be proper for a jury to take account of the fact, or the chance, that the business would not make profits; that they might make profits for a while and then economic conditions might change. This would be all part of the chances which a jury has to take into account in estimating what is the value of the chances which have been lost. When it comes to a case of a business in this way, it is very much a question for the jury. We have been referred to passages and authorities which would seem to suggest that a jury has to be satisfied on a balance of probabilities that future events would occur, that a business would expand, that profits would be made. We do not think that this is a correct approach when dealing with losses of chances … [In] our view the test is that the plaintiff is entitled to be compensated for a loss of the chance and the extent of the compensation depends on the degree of the chance."

[40]

84 An illustration of the court's readiness to award damages for diminution of earning capacity arises when very young children are injured. Strictly speaking it would be impossible to prove that the child would have had an earning capacity as an adult or would have exploited it. But it is conventional to rely on the occupations, attitude to life and work histories of parents and other relatives: Kalo v Bristol Omnibus Co Ltd [1975] 1 WLR 1054; Gowling v Mercantile Mutual Insurance Co Ltd (1980) 24 SASR 321; Bullock v Miller (1987) Aust Torts Reports 80-128; Burford v Allan (1992) 60 SASR 428. See also the position in England described in McGregor on Damages, 16th ed., paras 1381-1382. 85 Further, the willingness of the courts to compensate plaintiffs for reduced earning capacity in the absence of specific evidence is highlighted by their willingness to compensate even where there was an increase in the post-injury but pre-trial earnings of the plaintiff which was prima facie contra-indicative of loss. In Russell v J Hargreaves & Sons Pty Ltd (1956) 30 ALJ 533 at 534 Dixon CJ and McTiernan J increased the trial judge's award and said of the plaintiff in this position: "His efficiency as a driver and his capacity to drive for any lengthy period have obviously been greatly impaired and even if an exact sum of special damages has not been proved the existence of this head of damage has been shown as a substantial element and ought to have been taken into account in assessing general damages." 86 It is true that in some cases the courts have supplemented exiguous evidence by resort to judicial notice. The courts have inferred that rates in private employment are not lower than in public employment. Thus in Dessent v Commonwealth of Australia (1977) 13 ALR 437 Mason and Aickin JJ were prepared to assume that the earnings of a carpenter in civilian life would be not less than those of the plaintiff carpenter while in the Royal Australian Air Force, ie $100 per week net, and said: "it would be reasonable to assess the appellant's loss of earning capacity at not less than 25 percent of his full capacity, that is $25 per week …". In Leis v Gardner [1965] Qd R 181 at 187 Stable J thought it "notorious that an unskilled man does not overall get the same economic rewards as a skilled man. Were it otherwise, then why bother acquiring a skill at all?" He upheld a verdict of which one ingredient was $500 for loss resulting from incapacity to work as a bricklayer despite the lack of evidence of the difference in earnings. But in many instances substantial damages have been assessed for impaired earning capacity despite an absence of evidence about earnings and an inability to take judicial notice of them. 87 In short, where earning capacity has unquestionably been reduced but its extent is difficult to assess, even though no precise evidence of relevant earning rates is tendered, it is not open to the court to abandon the task and the want of evidence does not necessarily result in non-recovery of damages. Statements to the contrary such as those made in Allen v Loadsman [1975] 2 NSWLR 787 at 792 are not correct: Baird v Roberts [1977] 2 NSWLR 389 at 397-8 per Mahoney JA; J K Keally v Jones [1979] 1 NSWLR 723 at 732-735 per Moffitt P; Yammine v Kalwy [1979] 2 NSWLR 151 at 154-5 and 156-7 per Reynolds JA and Mahoney JA; Thiess Properties Pty Ltd v Page (1980) 31 ALR 430; see also Radakovic v R G Cram & Sons Pty Ltd [1975] 2 NSWLR 751 at 761 where Samuels JA criticised the "meagre facts" provided but did not say it was not open to the jury to find a substantial sum for diminished earning capacity by the "application of their own knowledge and experience". The task of the trier of fact is to form a discretionary judgment by reference to not wholly determinate criteria within fairly wide parameters. Though the trier of fact in arriving at the discretionary judgment must achieve satisfaction that a fair award is being made, since what is involved is not the finding of historical facts on a balance of probabilities, but the assessment of the value of a chance, it is appropriate to take into account a range of possible outcomes even though the likelihood of any particular outcome being achieved may be no more than a real possibility. The trial judge in substance explained these aspects of the jury's task satisfactorily.

[41]

Ground 4 : The summing up 88 The trial judge correctly reminded the jury of the difficulties of their task. He spoke of the assessment of "what would have been her earning capacity during life but for the accident" as "a very vague exercise". He said the jury had to be satisfied on the balance of probabilities that the sum claimed by the plaintiff was a fair and reasonable sum. He also said that if the jury found it not possible in relation to future earning capacity to arrive at "a sensible and fair and good decision simply on a mere balance of probabilities", it was permissible "to look at the odds, look at the proportion, look at the possibilities". He warned that though what he was saying might sound "a bit woolly", "the whole task is rather woolly". On the other hand, he warned that speculation was to be avoided. He said that the jury, like judges sitting alone, had to do their best and could not refuse to reach a conclusion. He also reminded them that the assessment of future economic loss involved a double exercise in prophesy: prophesying not only what the future held for the plaintiff, but also what it would have held for her had she not been injured. He stressed that the inquiry was into lost "capacity to earn". 89 The judge made the following more specific remarks about the earning capacity which the particular plaintiff had lost. He said that because she had been injured before her full-time working life had started, "prophesying what the future would hold for her if she had not been injured and what would have been her earning capacity is very difficult". He said: "Everybody says this is a lady who has got bags of guts, and who has gone back to work as quick as she could". She came from a very hard working family. Before the accident she had a part-time job in Year 10. She was keen to be a hairdresser and "would have liked to have built it up and had her own business". He said that the jury might think she was "obviously going to go all out to make a good result of her life". He said: "so it may well be that you would have little doubt coming to the conclusion that more likely than not, if she did not have the accident, she would have done her apprenticeship and gone on to run a business". He said: "you may well, having seen her and heard her, be left in no doubt that she was a lady who would have made the most of her earning capacity for the rest of her life, as you would expect, using your commonsense knowledge, of the girl's upbringing". He said: "Unfortunately, and I am not being critical of this, because you never get a case of perfection, you do not really have the figures of what people earn in hairdressing salons, but you have got the agreed figure that the average weekly earnings nett for a lady these days is $500 a week and it is on that basis that counsel for the plaintiff, who has given you the figures of what she has been earning since 1990 and up to date, said 'well compare that with what she would have earned had she been a hairdresser and take the example of the average female'. That is the area where the commonsense and experience of a juror, and particularly four jurors, is terribly important, because you have the benefit of this written submission, the aide prepared by counsel for the plaintiff, as to what it is hoped the plaintiff will recover. You have also got the benefit of the final address from counsel for the defendant who picks on parts of it and says 'dear dear dear no, it is not that much for these reasons'. So in respect of loss of earning capacity, you have got to use your commonsense and that is the reason why I always enjoy having juries." 90 He also said: "If you reach the situation where you find it is not really possible say in relation to her future earning capacity on the evidence you have got to make a sensible and fair and good decision simply on a mere balance of probabilities, it is permissible to start looking at the odds and say: 'Well, on one view of it but for the accident we have no doubt she would have gone on to be a hairdresser and run a good business and probably would have earned a darn sight more than $500. In another case with another plaintiff, you might say the plaintiff had Buckley's chance of doing what she might have even had a genuine desire to do. You may come back in a case like this to looking at future economic loss if applying just a mere balance of probabilities does not seem real to you, to look at the odds, look at the proportion, look at the possibilities and reflect that in the final sum you arrive at for loss of earning capacity in the future." 91 None of what the trial judge said in the respects described above would appear to have been erroneous either in fact or in law.

[42]

Ground 4 considered 92 It was open to the jury to "recognise that those who assume the risks of private enterprise are apt to exact higher rewards" (quoting Glass JA in Gilles v National Instruments Pty Ltd (Court of Appeal, unreported, 24 September 1974). It was open to them to conclude that those who undergo apprenticeships and training are apt to exact higher rewards, as Stable J suggested in Leis v Gardner [1965] Qd R 181 at 187. A jury could also infer that some hairdressing businesses earn for their proprietors much more than $500 per week, even if many may earn little more than that, and some may earn less than that. That there are expensive establishments which have been in existence for substantial periods is a matter of daily observation: those establishments run high risks through high rents, and must achieve high returns. The question is not what the average or mean earnings of hairdresser business proprietors are. The question is what fair compensation would be for a person whose character, appearance, experience and family background combine to make it extremely likely that she would have succeeded in running a hairdressing business and would have gone "all out to make a good result of her life" in the financial sense as well as in other senses. While many hairdressing businesses might not be particularly lucrative, the odds were good that a person with the plaintiff's characteristics would have enjoyed success to the extent of at least $100 per week more than average weekly earnings. Even after the physical and mental scarring of the accident, the plaintiff retained much drive - ceasing work only just before the birth of her children, returning soon after, achieving good examination results despite not attending school, entering the work force, and participating, on and off the field, in sporting activities to the extent to which her injuries permitted. 93 So far as the defendant appears to characterise Ground 4 as a "no evidence" point it appears to be misconceived. While there was no evidence of the earnings of hairdressing business proprietors, there was evidence of average weekly earnings, which, the court was told, includes those earnings. The jury could conclude as a matter of common experience that there was a likelihood that some proprietors of hairdressing businesses would earn more than average weekly earnings. The task on which the jury was engaged was of its nature "foggy", to use the expression of Moffitt P in J K Kealley v Jones [1979] 1 NSWLR 723 at 735, and "woolly", to use the expression employed by the trial judge in his summing up. The task was to value a lost chance. It is relatively easy to value a chance where a plaintiff has been employed in an occupation at a particular rate of income and after the injury cannot continue in that occupation but can in a lower paid one. In those circumstances the courts commonly look for a measure of particularity both in the pre-injury income and in any increase in it which the plaintiff contends would have been likely but for the injury and in the post-injury income: Stauffer v Hanley (NSW Court of Appeal, 6 April 1978, unreported). Even there the courts may act on evidence which is less than satisfactory. Thus in Chelini v Northern Territory Port Authority (1976) 12 ALR 519 the High Court increased a verdict one element of which was $30,000 for general damages by a further $20,000. Though the case was "riddled with unpredictables" and the "material … as to economic loss was minimal", being limited to wages which the defendant paid the plaintiff before the accident and would have paid the plaintiff after the accident if employed in another role, the High Court increased the verdict despite the "paucity of the material as to economic loss". It is much harder to value a chance where, as here, the plaintiff was a school child and the source of income lost is a professional business, not income from labour which is governed by awards or capable of establishment by reference to market rates. But since the obligation to value it cannot be shirked, deficiencies in the materials advanced may be tolerated. In this appeal the defendant contended that the absence of evidence about the earnings of hairdressing business proprietors was significant, because it would have been easy to call such evidence. That may be questioned. Though there may be persons who commonly value such businesses, or officers of hairdressing trade associations, and though it may be that persons in either class could assemble the evidence of what the proprietors of hairdressing businesses earn, it has not in fact been demonstrated that any people in these categories exist, or that it would be easy or feasible to prepare appropriate evidence. Nor has it been demonstrated that that evidence would not have thrown up a similar pattern of complexity to that alluded to by Moffitt P in J K Kealley v Jones [1979] 1 NSWLR 723 at 734-5 so far as barristers are concerned, namely so great a variety of non-standard instances that it would be difficult for the jury to handle. 94 The defendant presented its argument on Ground 4 as facing an obstacle created by Pt 51 r 23 of the Supreme Court Rules, and as resting on a failure by its own counsel at the trial to seek an appropriate direction or re-direction. This misstates the problem. The only direction or re-direction which would have corresponded with Ground 4 would have been that entailed in a request by the defendant to the trial judge to forbid the plaintiff to address along the lines of paragraph 3(b) of the plaintiff's Schedule. If that request had been made, it would not have been right to accede to it, because while the absence of evidence about the earnings of self-employed hairdressers may have weakened the plaintiff's contention, it did not of itself preclude acceptance of the plaintiff's contention. The only appropriate request would have been a request that the jury be warned about the danger of taking the precise figure of $100 per week without exercising caution. In substance the jury was given that warning. The defendant did not ask the trial judge to forbid the plaintiff to address along the lines of paragraph 3(b). The defendant cannot now place itself in a better position as a result of not having made that request than it would have been in if it had made that request. 95 If, on the other hand, the defendant's characterisation on appeal of its counsel's conduct at trial is correct, Ground 4 faces a different difficulty. Below the defendant contended for nil recovery in relation to future economic loss, but it apparently did not contend that there was no evidence in relation to that component of it which was represented by $100 per week more than average weekly earnings, and it did not ask for a direction in that respect. There was no evidence as to why it did not. The position is similar to that put by Hutley JA in Linsell v Robson [1976] 1 NSWLR 249 at 252: "As the trial was conducted on the basis that there was sufficient material to enable the judge to give a substantial sum for diminution of earning capacity, in my opinion it is not appropriate for any issue of this nature to be raised in this Court in this case. …" 96 In my judgment Ground 4 is not made out.

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Cases Cited (25)